How privacy and personalization intersect in our data-filled world

For many this can seem like a catch-22, while consumers demand privacy, it's not likely they'll become long-term customers without some type of personalization.

How Privacy and Personalization Intersect in Our Data-Filled World

photo by Tom Sodoge (CC0)

The data paints an even bleaker picture: studies show that 96 percent of consumers are concerned about data  privacy, but if a company sends irrelevant info, 65 percent of consumers will unsubscribe from their mailing list, 47 percent will ignore all future communications, 16 percent will stop purchasing products from the company, and 11 percent will complain about the company to others.

So how do these two seemingly contradicting concepts come together for businesses in our data filled world?

Instant gratification and the on-demand economy

While it may seem unrelated, the on-demand economy and desire for instant gratification by many consumers actually fuels their desires for more personalization. Consumers are now moving through the customer journey faster than ever.

Their journey is no longer defined by lengthy stages, but micro moments -- which when personalized ensure repeat business. In order for businesses to appeal to buyers in these micro moments, they must have a firm understanding of psychology and be able to analyze large amounts of data using tools like SQream. Using the insights gained from the data and pairing it with psychology will give them the power to create accurate personas and journey maps which will help guide personalization.

The importance of choice

Choice is the most important consideration for consumers when it comest to personalization and privacy. Google’s blunder with adding code that could record user conversations (used for their “Ok, Google” feature) wasn’t the code itself or it’s potential to invade privacy, but rather the fact that it was added to chrome without user’s choice. If Google had a simple opt in, opt out for the feature before installing the code, people would have been more comfortable as they were empowered in the scenario.

Transparency

Another key point for consumers is transparency. They want to be able to access and read your privacy policy easily. Many privacy policies are poorly formatted and difficult to find, let alone read. Care Predict, a wearable for seniors that monitors their daily activity, uses transparency to put consumers at ease while collecting a large amount of personal data. Their wearable, the Tempo, tracks the daily schedules, habits, activities, eating quantity and times, and sleeping data from seniors. This is incredibly personal data which would be troubling to many, but by providing a well formatted and easy to find privacy policy, they put their customers' minds at ease.

An example you can learn from

Here’s an example that may help guide you on how to create a more personal experience without triggering consumer’s privacy concerns:

Target’s pregnancy prediction score

By analyzing shoppers buying habits, target was able to come up with a list of 25 items that signal a women may be in her second trimester of pregnancy. Using this data, they would send personalized coupons containing baby items to soon to be moms, but they quickly realized that moms didn’t appreciate the feeling of being spied on, so to fix the situation they simply added irrelevant coupons so it’d appear that everything was at random, giving the illusion of privacy while still personalizing the experience.

Points to remember

In order to please consumers, businesses will need to provide a personalized experience even in micro moments. However, businesses should not forget that they need to be transparent by sharing their privacy policy in an easy to digest way. Lastly, businesses need to empower consumers by giving them the power to choose when and how their data is collected and used.

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